Generally, submission of loan applications from customers has been historically performed using paper forms which require various personnel to manually input data into a resident computer system at the financial institute for the subsequent review, compilation, evaluation, and approval. Because the processing of these forms is very labor intensive, traditional credit approval processes were highly inefficient and time consuming, particularly since the loan application forms and information contained therein require review for errors, non sequiturs, insufficient and/or incomplete information.
Attempts have been made to improve efficiency and response through on-line type credit authorization systems. Presently, there are two known major automotive credit application services which coordinate loan application information between multiple financial institutes, IBM's AutoLoan Exchange (ALX) and Credit Management Solutions', Inc. (CMSI) Credit Connection. These systems are arranged to allow transmission of credit application information from a dealer location to various financial institutions, as well as transmission of responses from the financial institutions back to the dealer. While these systems have generally improved loan application efficiency and processing time, they also suffer the drawback of requiring installation of unique and specific computer hardware at the dealership location. As a result, these systems are expensive to operate and maintain. In addition, because specially adapted hardware must also be installed at the financial institution end, access via a single information distribution hub is only available to those financial institutions which choose to install the specialized equipment. Thus, a dealer may not be able to improve loan application processing efficiency for financial institutes with whom the dealer chooses to conduct business if the desired institution does not participate in the on-line credit system.
Therefore, a need exists for an improved method and system for processing automotive credit applications which simplify hardware requirements to increase ease of access and use at each participating retail location, while also broadening access to potential financing service providers.